ADA dentists discuss PPP loan cancellation
12 october 2020
Washington – Months after receiving the Paycheck Protection Program funds, many dentists begin to consider seeking remission.
The Paycheck Protection Program was established by Congress in the Coronavirus Aid, Relief, and Economic Security Act to provide small businesses with economic relief in the wake of the COVID-19 pandemic. According to a ADA Health Policy Institute Survey as of September, more than 90% of the 19,000 dentists surveyed said they had requested an exemption from the federal program. Borrowers will need to start making payments unless they submit forgiveness requests within 10 months of the end of the forgiveness period for their loan.
In early October, the US Small Business Administration began approving pardon requests.
For Dr. Phillip Fijal, chairman of the ADA Council on Government Affairs and general dentist in Des Plaines, Ill., The decision to apply as soon as possible was simple: he wanted to start the forgiveness process.
“I proactively went to my bank and said, ‘What should I do? “” said Dr Fijal.
The first step was to decide which of the two forms of forgiveness to use: the EZ request or the standard request. Dr Fijal opted for EZ. The ASB has since published an additional form, which simplifies the process for loans under $ 50,000.
When choosing the pardon application period, Dr Fijal chose the 24 week period, which dictates that the company must have used at least 60% of the P3 funds for payroll. Because he uses an external payroll service, he said he was also able to easily upload all of his payroll documents and submit them along with the pardon request.
“Most outside payroll departments should be able to create a P3 Payroll Forgiveness Report,” he said. “If you’re not going to use all of your money for payroll expenses, there are places on this form that you should put in the amount of money you spent on rent, the amount of money you have spent on supplies and documentation is needed to verify this.
Dr Fijal said the driving force behind taking out a small business loan was to keep his staff employed when his practice was closed for almost two months at the start of the pandemic. Meanwhile, he and his staff have kept busy tackling administrative duties, renovating the office and preparing to open under new security protocols in the wake of COVID-19.
“We stayed apart, we kept our masks on, but there was a lot of work to be done administratively,” he said. “It was a real time for us to bond together as well as as a group. The PPP money has really helped a lot. I knew the staff salaries were going to be taken care of, and I could just focus on the other receivables and start paying some of the other bills.
Dr. Richard Andolina, a general dentist in Hornell, New York, and former chairman of the ADA Political Action Committee, also took out a loan from the Paycheck Protection Program. His journey began when he was forced to close his practice for three months of routine dental care when providers in New York were limited to emergencies only. During this time, he has put most of his staff on leave.
“After the ‘break’ was lifted on June 2, our office opened to an extremely limited patient flow, probably 20% of our normal schedule, fully following the recommendations of the ADA and CDC guidelines,” said Dr Andolina. “Over the following months, we increased the flow of patients and procedures and we are currently at about 90% of normal. “
“Having practiced for almost 40 years, I was financially able to handle the situation. My concerns continue to be with new dentists and businesses in our community, ”he continued. “The reason I’m worried about other companies is that they employ a lot of our patients. Without income, it is likely that our patients’ regular dental care would be delayed or canceled.
A unique point of view
Dr. Andolina brings a unique perspective to the small business lending experience. In addition to dentistry, he is also passionately involved in the banking industry, serving as chairman of the board of directors of Maple City Savings Bank in Hornell. This experience also allowed him to witness the PPP program from the lender’s point of view.
“Our bank deals regularly with the SBA, but not to the extent imposed on it with this initiative,” he said. “In the initial funding, the very large banks were able to develop programs to complete applications quickly and those that received funds were mostly large corporations and businesses, not small businesses such as dental offices. . These issues were corrected, allowing the rest of the requests to be processed and ultimately funded. “
Dr Andolina pointed out that the initial PPP regulation for remission was based on an eight week period from when the money was loaned before being extended to 24 weeks.
Dr Fijal said he was informed about the cancellation of PPP loans and updates to the ADA program and also in the daily Morning Huddle email newsletter which is sent to ADA members. He said it was the first PPP loan processed by his bank.
“I was able to help my bank with the app and answer some of the questions they may have had,” he said. “I think it was quite beneficial for our bank, that I was the first one, because it also helped them resolve a lot of issues.”
He said he consulted his accountant and banker during the application process and encouraged all dentists to develop similar relationships, as well as a relationship with a lawyer.
“I think after all this time the thing that strikes me the most is that you really have to have a good relationship because it’s going to help somewhere,” he said. “It did it for me. It was a huge relief to be able to go to my bank and say, “Hey, I need this money,” and they can help you find your way there. It simplifies things and takes a lot of stress away from us at a very stressful time. “
Dr Andolina said he recently submitted the necessary documents to request the full cancellation of the PPP loan after using all of his loan proceeds to fund eligible salary expenses.
“Our bank is reaching out to encourage businesses to request a loan forgiveness as soon as possible, assuming they have spent the money for qualifying expenses,” he said.
Dr Andolina said he and the bank are also monitoring a possible next round of COVID-19 relief laws.
In the meantime, the two dentists are happy to have asked for forgiveness.
“It is our responsibility to be proactive in asking for forgiveness,” said Dr Fijal. “Be aware of when your 24 week window is ending, and then ask your bank what they’re looking for. “
ADA strongly supports legislation to streamline the delivery of PPP loans. In July, the Senate introduced the Paycheck Protection Program Small Business Pardon Act, which provides for the cancellation of loans under $ 150,000 after the completion of a one-page document. Also in July, the ADA signed a coalition letter who estimated that Paycheck Protection Program loans under $ 150,000 represented 86% of total loan recipients, but less than 27% of all Paycheck Protection Program loans.
For instructions on how to use the EZ form to request forgiveness, visit the SBA site. There is also a list of tips from the Academy of Dental CPAs for dentists who are asking or considering asking for a pardon.
For more information on ADA’s advocacy efforts during COVID-19, visit ADA.org/COVID19 Advocacy.